📈 Futures
US Capital Private Bank Knowledge Base
📌 Overview
A futures contract is a standardized legal agreement to buy or sell a specific asset—such as commodities, currencies, or financial instruments—at a predetermined price on a specified future date. Futures are commonly used for hedging risks or speculative trading.
🔍 Key Features
| Icon | Feature | Description |
|---|---|---|
| 📅 | Standardized Contracts | Futures contracts are standardized by exchanges regarding quantity, quality, and delivery date. |
| ⚖️ | Obligation to Buy/Sell | Both parties are obligated to fulfill the contract on the settlement date. |
| 💹 | Margin Requirement | Traders must post margin (collateral) to enter and maintain futures positions. |
| 🔄 | Mark-to-Market | Daily settlement process adjusts accounts based on market price changes. |
| 🔒 | Hedging & Speculation | Used by producers, consumers, and investors to hedge risk or speculate on price movements. |
⚙️ How Futures Work
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A buyer agrees to purchase an asset at a future date for a fixed price.
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A seller agrees to deliver the asset at that price and date.
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The exchange acts as a counterparty, reducing credit risk.
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Traders maintain a margin account and settle gains/losses daily.
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Contracts can be closed out before maturity by entering an opposite position.
📊 Uses of Futures
| Use Case | Description |
|---|---|
| 🛢️ Commodity Producers | Lock in prices to stabilize revenues (e.g., farmers, oil producers). |
| 💼 Investors/Speculators | Profit from price changes without owning the physical asset. |
| 🏦 Financial Institutions | Manage exposure to interest rates, currencies, or equity indices. |
⚠️ Risks
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Leverage Risk: Margins allow large exposures but can amplify losses.
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Market Risk: Prices can be volatile and unpredictable.
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Liquidity Risk: Some contracts may be less liquid, making exit difficult.
🔗 US Capital Private Bank Support
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Expert advisory on futures trading and risk management strategies.
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Access to global futures markets through institutional platforms.
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Integration of futures in diversified portfolios under Divine Law Trust protections.
📬 Contact US Capital Private Bank
📧 Email: [email protected]
🌐 Website: https://uscapitalprivatebank.com
📞 Phone: +971529926005
🎥 Learn more about futures and derivatives:
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